More Olympus fraud fallout as banks sue for $273 million
posted Wednesday, April 9, 2014 at 12:43 PM EST
The old ship Olympus has somehow begun to right itself after the $1.7 billion accounting scandal that nearly sank the company in 2011. The company’s imaging division isn’t in the black yet, but strong sales of the OM-D E-M1 have helped to cut losses by $25 million, and with trickle-down effects like increased lens sales, the future looks promising.
But for any publicly held company that commits fraud on such a massive scale, there are bound to be lingering consequences. Six Japanese trust banks have filed a lawsuit against Olympus to the tune of $273 million for “damages on behalf of investors whose funds they held,” according to a Reuters report.
A judge set a three-year statute of limitations for filing suits against Olympus, which would expire toward the end of 2014. A representative from one of the six banks said that they acted to meet this deadline, and it seems likely that other investors will file suits in the following months. Olympus said in its most recent earnings call that it has already set aside about $166 million to settle three other ongoing suits.
In 2013, three former Olympus executives were given suspended sentences after pleading guilty for their roles in the scandal. The company has sued those three men (and at least a dozen others) for damages.
According to internal projections, Olympus’s camera division is expected to turn a profit in fiscal year 2014, which began this month. They’re forecasting sales of 1 million mirrorless units. If the predictions hold up, it’ll be the first profitable year for the division in quite some time. It could be a turning point for the better for the once-beleagured company.